DA: MTA loophole allowed for $150k in kickbacks

(Charles J. Hynes)

The MTA’s legal department hasn’t been playing by the rules, with managers pocketing tens of thousands of dollars in kickbacks for phony work, according to investigators.

Brooklyn district attorney Charles J. Hynes indicted three people Tuesday with skimming $150,000 in NYC Transit business over four years, but investigators believe the scam could go back a decade. “There was a total violation of the most basic internal controls,” MTA Inspector General Barry Kluger said.

A loophole allowed law department supervisors to both choose suppliers and pay their bills, eliminating any oversight of its $15 million purchasing budget, Kluger said. Jacqueline Jackson, a division supervisor, is charged with steering work to a bogus company to process workers compensation cases. The 51-year-old Brooklyn woman also directed work to a former prosecutor, who billed the MTA $400 a case, and in turn he paid Jackson’s gas and electric bills, investigators said. The theft allegedly amounted to about 1 percent of the department’s entire purchasing budget.

Jackson, who faces 15 years in prison if convicted, is fighting the charges, saying she had no direct authority over the vouchers, according to John Rodriguez, her attorney.

“She is absolutely innocent. She didn’t steal anything,” Rodriguez said.

Transit has since clamped down on the department, including increased oversight for payments and restricting the use of outside legal examiners, a spokesman said.